WEX Surpasses Earnings Estimates In Q4, Misses Revenues
Zacks Investment Research | Feb 18, 2020 09:48PM ET
WEX Inc. (NYSE:WEX) reported mixed fourth-quarter 2019 results, with earnings beating the Zacks Consensus Estimate but revenues missing the same.
Adjusted earnings of $2.61 per share beat the Zacks Consensus estimate by 2% and increased 24% year over year. The reported figure exceeded the midpoint ($2.56) of the company’s guidance of $2.51-$2.61.
Total revenues of $440 million missed the consensus mark by 3.6%. Nevertheless, the figure improved year over year on the back of growth in all segments. Revenues fell short of the midpoint of the guidance of $452-$462 million.
Notably WEX shares have gained 32.3% over the past year, compared with 43.7% growth of the industry it belongs to.
Revenues by Segment
Fleet Solutions revenues (59% of total revenues) increased 2.7% year over year to $260.8 million. The upside was driven by robust transaction volume growth and higher late fee and incremental revenues from EG fuel, partially offset by lower fuel prices, unfavorable FX headwinds and a softer market environment.
Average number of vehicles serviced was around 14.9 million, up 19% from the year-ago quarter’s figure. Total fuel transactions processed increased 12% from the year-ago quarter’s tally to 156 million. Payment processing transactions rose 9% to 126.7 million. U.S. retail fuel price declined 4.8% to $2.80 per gallon.
Travel and Corporate Solutions revenues (22%) of $95.7 million were up 22.7% year over year. The uptick can be attributed to a 17% year-over-year increase in purchase volume. The company witnessed strength in accounts payable products and contributions from the Noventis acquisition.
Health and Employee Benefit Solutions revenues (19%) of $83.5 million increased 69.1% year over year, driven by growth in U.S. healthcare business, with 18% organic growth and better-than-expected contributions from Discovery Benefits. The average number of Software-as-a-Service (SaaS) accounts in the United States rose 17% year over year to 13.4 million.
WEX Inc. Price, Consensus and EPS Surprise
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